Ladies and gentlemen, good day and welcome to Shree Cement Limited hosted by ICICI Securities Limited. This conference call may contain forward-looking statements about the company which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantee of future performance and involve risks and uncertainties that are difficult to predict.
As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Navin Sahadeo from ICICI Securities. Thank you and over to you, sir.
Thank you, Danish. Good evening, everyone. On behalf of ICICI Securities, I welcome you all to the Q4 FY 2026 earnings call of Shree Cement Limited. From the management, we have with us Mr. Neeraj Akhoury, Managing Director, Mr. Ashok Bhandari, Senior Advisor, and Mr. Subhash Jajoo, Company CFO. Without any further ado, I hand over the floor to the management for their opening comments. Over to you, sir.
Thank you. Thank you, Navin. Good afternoon, and good evening, ladies and gentlemen. I welcome you to the earning call of Shree Cement Limited for the quarter and year ending March 26. 2025, 2026 was a good year for us despite the challenges posed during the Middle East conflict in March. In March 26 quarter, on a sequential basis, domestic cement sales volume increased by about 25% from 8.48 million tons in December 25 to 10.56 million tons in March 25, while year-on-year growth was at 11%.
Total volume, including clinker sales, also jumped from by about 9.4% from 9.84 million tons to 10.77 million tons, while increasing 23.2% on quarter-on-quarter basis. Realizations were at INR 4,725 as against INR 4,652 in December 2025, registering an increase of 1.6% during the quarter. Operating EBITDA also increased by 34% from INR 902 crore to INR 1,212 crore. EBITDA per ton increased from INR 1,032 to INR 1,125 in March 2026. Capacity utilization during the quarter stood at 66% as compared to 56% during December 2025.
For the full year, sales volume, including Shree Cement East, increased by 2.2% from 35.6 million tons to 36.4 million tons. Our strategy which we took for the full year helped in increasing our realization from INR 4,569 per ton last year to INR 4,732 per ton in 2025, 2026, registering an increase of 3.6%. Total operating EBITDA increased by 11% from INR 3,814 crore to INR 4,220 crore, excluding a one-time impact of INR 80 crore. EBITDA per ton stood at INR 1,161 as against INR 1,071 last year.
Our other company, Union Cement, performance have also improved significantly during the year 2025, 2026 on back of robust demand and continuously improving pricing scenario. Sales volume were up by 18% from INR 38.61 lakh tons to INR 45.65 lakh tons. Revenue was up by 39% during the year from AED 66.24 million to AED 870 million.
Since last two months, due to the tension prevailing in the Middle East, sales have slowed down, but with ceasefire situation is gradually coming back to normal. We believe once peace is restored, demand would bounce back due to the reconstruction work. The Union Cement continued with its impressive quarterly performance.
Total volume increased on a yearly basis from 10.72 lakh tons to 11.65 lakh tons, recording a growth of 9% on QOQ, on a quarter-on-quarter basis. Sales revenue was up by 18% from AED 210 million to AED 247 million on a quarterly basis.
During the quarter, the company commissioned its integrated project of 3.65 million tons clinker capacity and 3.5 million ton cement capacity at Kodla, Karnataka. With this, the company's installed cement production capacity in India, including its wholly owned subsidiaries, increased to 69.3 million tons, strengthening its position as India's third largest cement group.
The work on setting up a cement mill of 2.5 million tons in Union Cement, U.A.E. is progressing well and is scheduled to be commissioned by September 2026. To further expand our capacity, the company is setting up an integrated cement plant with clinker capacity of 0.95 million tons and cement capacity of 0.99 million tons in the state of Meghalaya.
During the quarter, the company also incorporated a wholly-owned subsidiary with a purpose to establish and operate cement blending, storage, and packing facilities in Mauritius. The company continues to actively and strategically pursue multiple expansion opportunities currently at various stages of pre-project development to accelerate capacity build-up and firmly position to achieve its growth milestones. The company is rapidly expanding its RMC business with 26 operational plants at the end of 2025-2026.
During the month of March 2026, company has inaugurated 10 new RMC plants which are currently under commissioning. With the commissioning of these plants, the total RMC plant count will increase to 36 plants, significantly extending the company's operational footprint at the start of financial year 2027.
The company continues to focus on sustainability initiatives. Key highlights of the same are as follows. The company's share of green electricity in total electricity consumption stood at 61% in Q4 2026, up from 59% on Q4 2025. Including its wholly owned subsidiaries in India, this is one of the highest in the Indian and most probably global cement industry. The company is consistently ramping up its green power generation capacity, which currently stands at 666.5 MW, including in its wholly owned subsidiaries in India.
All the company's manufacturing locations are zero liquid discharge, treating, recycling, and reusing 100% of wastewater generated from its operations. These efforts, aided by a good rainfall, have enabled the company to maintain its water positivity index to more than eight times in 2025-2026. The company continues to get AAA rated by leading rating agencies of India.
Last year, we also got our long-term foreign currency rating done by CareEdge Global. The rating given was BBB+, which is stable. Considering the strong cash position, the board of directors of the company have recommended a final dividend of INR 70 per share, in addition to the interim dividend of INR 80 per share for the year 2025-2026 declared in October 2025.
Total dividend for the year stands at INR 150 per share, representing a 36% increase over the 110 per share dividend paid in 2024, 2025. The final dividend shall be subject to approval of members in the next annual general meeting. India's macroeconomic environment remains resilient, supported by steady domestic demand and continued policy focus on infrastructure-led growth.
Union budget 2026, 2027 has reinforced this momentum through a sustained thrust on public capital expenditure, with investment in roads, railways, and urban infrastructure expected to drive construction activity and cement demand. Favorable employment conditions, stable inflation, and supportive fiscal and GST rationalization measures further strengthen sector's fundamentals. Against this backdrop, the cement industry remains well-positioned to benefit from healthy demand growth in the medium term.
However, the geopolitical conflict in Middle East and forecast of moderate monsoon conditions may act as headwinds for the sector and may impact its growth momentum in the short term. With this, I will now open the floor for the Q&A. I have with me Mr. Ashok Bhandari, Mr. Subhash Jajoo, Mr. K.K. Jain, and Mr. S.S. Khandelwal to take you through the Q&A session. Thank you, everybody. Again, warm welcome to Shree Cement's quarter four webcast.
Thank you so much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen.
Navin, before we start the Q&A, can I make a point, please?
Yes, please. Please go ahead.
Good evening, everybody. I would like you to recall two specific public communication we had made. One was at the end of June 25 quarter, when Mr. Bangur had gone on television saying that he expects the growth for Shree Cement in last financial year between 2% to 3%. We have delivered 2.2%.
The second attention I would like to draw is towards the last quarter's con call, where unfortunately Mr. Akhoury could not attend, where I had said that we have moved to a more stable pricing platform, narrowing the gap between the topmost player and us by almost INR 20 a bag, INR 50-INR 20 a bag, and now we will be chasing volumes. We have delivered on both these accounts, which explains our ethos of delivery and not proclamation. Now I open the floor for any questions you have.
Thank you so much, sir. Reminder to all the participants that you may press star and one on your touch-tone telephone in order to ask a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Hi, sir. Good afternoon, good evening, congrats on strong volumes and decent margin performance, continued margin performance. My question pertains to what next in terms of CapEx and the cash surplus, which is further increasing into a strong, you know, internal accrual generation.
Okay, Ravi Bhandari here. As far as CapEx is concerned, as on date, as Mr. Akhoury has already informed you, we are pursuing three distinct places. One is we will be increasing our RMC plants during 2026, 2027. Number two, we are aggressively working on railway sidings.
Number three, the Meghalaya expansion, for which orders have already been placed. However, the total CapEx estimation for the year 2026, 2027 is approximately INR 1,500 crores and it should take its own course. We expect to close the year with about 50 to 55 RMC plants, railway sidings and preliminary work on Meghalaya Cement.
Okay. Any thought on your long-term next two, three year expansion plans? Because this Meghalaya will be a smaller CapEx.
Look, my dear friend, we are on record saying that we should reach 80 million tons by 2029. Please understand it's a dynamic situation. We have slowed down the CapEx because even in the last con call of one of our competitors, they have also slowed their aggression. We will ride the wave as it is. We intend to reach 80 million tons by 2029, but let us see.
Yeah, understood. Agree. On the cash surplus, you know, you have increased the dividend for sure. That is a good move. Anything further because we are now close to INR 9,000 crore surplus cash.
No, no. We are 6,700 plus 7, 8,400 crore, roughly. You are correct. We will keep on finding the ways to reward the shareholders as well as if the situation improves, we can expedite our capital expenditure program by front-ending it. You will appreciate that in last 15 years or so, we have not borrowed. We have generally funded all our CapEx through our internal accruals, and we intend to do the same.
Understood. Second, on the, if I look at console minus standalone, just for clarification, would that give the UAE performance, or this would also include your subsidiaries performance, console minus standalone EBITDA?
Listen. Console has two components. One is Shree Cement East Limited, and one is UCC at Union Cement in UAE. Shree Cement East Limited will be the engine for further capacity expansion in India. UCC, as Mr. Akhori has already pointed out, is on track to add another 2.3 million ton of capacity by September 2026. I think it should keep us in good stead.
Great. Given that our growth engine will be the Eastern subsidiary, should we not be looking the company at a consolidated level rather than a standalone level?
Yeah, indeed.
We should be Yeah.
Indeed, indeed. I get your point. We had been looking at this possibility. Maybe next quarter onwards we will talk of console only.
Understood, sir. I'll come back in queue. Meanwhile, you know, you may share the operating numbers as we usually share and Jajoo. Thank you.
Thank you. Our next question comes from the line of Harsh Mittal from Emkay Global Financial Services. Please go ahead.
Yeah. Thank you for the opportunity. Good evening to the management. My first question pertains to the freight cost, which appears to have increased by INR 80 per ton kind of a number from, on both YOY and sequential basis. Any reason for the same, sir?
No. What has happened is that, the lead distance has increased by about 12 kilometers over last quarter. We are seized of the fact, and we are working towards reducing this and maybe bring it back to sub 440 kilometer ton. You see, basically, it is completely dependent on the demand supply scenario of each region.
We are working on it, and we should be able to bring it under our control.
Yeah. My second question is that in the last con call, we mentioned about the depreciation guidance of around INR 1,600 crore-INR 1,700 crore. Are we sticking to the same number for FY 2027, or is there some upward revision?
Yes, we are sticking to that.
Sure, sir. Thank you. These were the questions. I'll join back with you.
Next question comes from the line of Amit Murarka from Axis Capital. Please go ahead.
Yeah. Hi, good evening, and thanks for the opportunity. On the strong volume growth delivery in Q4, which is like 11% YOY on cement level is what I see. Going ahead, how do we see it? Like full year is obviously two, but Q4 is pretty high. Going ahead, like should we expect full year run rate to also now be at similar levels?
Basically, the guidance we have been maintaining is 1% over the average industry growth rate. However, we expect to reach about 40 million tons in this year. 2026, 2027, we should be around 40 million tons. Of course, there are lot of macroeconomic factors which are beyond our control. Hopefully things will do well.
Just to clarify, 40 is cement including clinker or only cement?
Look, my dear friend, clinker is not our choice. We would not like to sell clinker because we are losing the value add opportunity. Clinker is basically for various small reasons, it's not a meaningful volume at all. Please do not look at clinker volumes at all. Look at cement. Or see what I am saying is maybe including 200,000, 300,000 tons of clinker. Otherwise, it should be cement only.
Sure. Sure. Understood. Generally on this West Asia crisis, while we know that there is cost inflation that everyone is facing, what are the mitigation measures? I believe now coal probably is cheaper than petcoke. Are you switching into coal more than petcoke? What are the mitigation measures basically?
My dear friend, it's a dynamic exercise for us. We keep on work, evaluating the techno commercial viability of various kind of fuel mix. As on date, yes, you are right, coal is becoming cheaper than petcoke. Petcoke prices also cooled down by more than $10 a ton.
We are not concerned with what fuel you are we are using. We are concerned with landed cost per kilocalorie on air drive basis at our plant. We are constantly on that. Indeed, yes, the fuel cost, which is standing at about INR 1.60 per kilocalorie as on date, will move up maybe by 10% or something for next, this quarter. Yes, we are, this is our business to keep on maintaining our sustainability and profitability.
You may also note that in spite of whatever results whosoever has declared, our EBITDA per ton of cement for the year 2025, 2026 is by far the highest in the peer group.
Right. Right. Congratulations on that. Just lastly, if I may, could you provide region-wide capacity utilizations for you?
Look, my dear friend, all these details I am now asking Mr. Jajoo and Mr. KK Jain to fill you up with these details. I don't have these details in front of me. They must be having it. Mr. Jajoo, can you answer please?
Yes. For the full, for this quarter, for north the utilization is 70%, for east it is 60%, for south it is 61%. As company as a whole, the utilization is 66%. As compared to December, the number was 56% for the company as a whole. From 56 we have increased it to 66%.
Got it. Thanks a lot. I will just come back in for more questions.
Thank you. The next question comes from the line of Siddharth Mehrotra from Kotak Securities. Please go ahead.
Thank you, sir, for the opportunity. As with your competitors also sort of going slow on expansion, do you think there is a chance that demand might be sort of impacted in the oncoming year? What are your thoughts on demand specifically for, say, the next 12 months?
Let us understand, my friend. Before the new series of GDP came into play, the demand was 1.3x the GDP growth rate. Once the GDP series got the constituents of GDP got reconstituted, the demand has come to around one to 1.1 times GDP growth rate. There are the bedrock of growth, economic growth is steel and cement.
If India needs to grow at 7%, steel and cement should grow at least in tandem with that, if not more. We expect this year 6.5% to be the GDP growth rate. We should do about 7.1%, 7.2% cement demand growth rate. As I have said, that should be the industry average.
We should grow at about 8% to 8.5%, but you can never say. Let us see how the GDP moves. It's still early days.
Thanks for your thoughts on this, sir. Just another question. We've seen a fair amount of cost inflation, as you rightly pointed out. I just wanted to check, what are the prices looking like this quarter? Have we been able to mostly pass those on to the customers, or do you think we need more price hikes to sort of?
No, no, listen. The fundamental principle of any business is ye dil maange more.
Yes.
Let us be very clear that whatever we can pass on a sustainable basis to the market after absorbing our cost push, we should be all right. We will aim to increase the profitability. Let us see how it pans out. In any case, if the war in Middle East gets over in next two months, the fuel prices are about to come down. It is a completely dynamic situation as on date.
Got it, sir. Any chance you could provide us some color on the hikes which has been taken, say, for example, in the past month or so?
About INR 25 a bag.
This is across regions or?
I don't have that kind of a breakup.
Okay.
south is okay. This you can of course ask Mr. Kamlesh Jain or Mr. Subhash Jajoo to send you a mail separately on this.
Got it, sir. Just one last bookkeeping question. The sales figure that you've mentioned, that includes volume sales from our wholly owned subsidiary as well?
Subsidiary is only in India.
Yes. Yes. Yes. Correct.
It does. It does. It does.
Okay.
10% is the sales from the Indian operations.
Okay. That 10.77 number is including Shree Cement too. Right. Got it.
Yes.
Thank you, sir. Thank you.
Thank you. Next question comes from the line of Pinakin from HSBC Bank. Please go ahead.
Yeah. Thank you very much. My first quick bookkeeping question is that, what is the net cash balance as of March 26th?
We are at about INR 6,400, INR 6,700 crore in investments and INR 1,700 crore cash. Cash in bank. Yes.
Got it. My second question is, sir, on capacity expansion. Sixty-nine million tons capacity as of March 26th, and overall annual full year utilizations would be in early 60s. That 80 million ton target by S-29, given the utilization levels that are there, can we expect this to get pushed out by a couple of years?
I can't say. It's too early to comment. We have slowed down. I have given a guidance of INR 1,500 crore only for CapEx in this year. Let us see how the situation plays.
Got it. Sir, this value over volume, and now we are focusing on volumes. Is it fair to say that between volumes and price and EBITDA margins, while you're chasing volumes, EBITDA per ton is also something you will keep on focusing on and not let it go down much?
Look, my dear friend, let us understand. Q2 and Q3 of last financial year, we suffered to pull up our prices. We did not aggressively sell. Once the prices have established to a level where the delta between the top players and us has reduced significantly, we don't intend to give up that advantage. We would like to have now our fair and proper market share.
That doesn't mean we'll go into a price war and push volumes. Profitability is the prime focus. Volume and price always the market gives. Volume is what we are capable to produce. This is the situation. Now, how it will put pressure on EBITDA, we have never in our history given any guidance on EBITDA per ton.
We have never given you any guidance on sale price per ton because it is not in control of any commodity manufacturer, leave aside cement. It is a completely macro-driven equation, and we would not like to hazard a guess. We can say what our costs are, we can say what our aspirational volumes are, and balance with whatever will happen to everybody will happen to us as well.
Got it. This is very clear. Thank you very much, sir.
Thank you. Next question comes from the line of Ritesh Shah from Investec. Please go ahead.
Yeah. Hi, sir. Thanks for the opportunity. Sir, couple of questions. First is, if you could, sir, put some details on the northeast expansion, specifically around limestone sourcing. If we have won a mine, what is the auction premium that they have, what we have paid? Any indicative timeline, timelines on the expansion that we have indicated.
600 million tons, yeah. You know, we have gone by the laws of local government in Meghalaya, the state laws, where the state government allocates the mines. What we have got is three blocks. Each block, we have not completed all the three blocks, but the first block where we have done our detailing, we've, we believe this, we are talking about roughly about 600 million tons of limestone. Yeah.
Right.
Um-
The premium that we have paid, and if you have any secured any incentives for this project along with the timelines?
Meghalaya mines are not auctioned. They are allocated, yeah.
Allocated.
Uh-
Okay. Sir, incentives?
No. We have not yet received any confirmed paper document from the government of Meghalaya on incentives to be given. Yeah. We have approached them, we have not got any confirmation from that. This project is to our estimate strongly viable even without incentives.
Sir, how should we look at the CapEx number? It looks very high, INR 1,800 crore. Is it because of the region or is it something different?
No, my dear friend, Bhandari, yeah.
Yes, sir.
The INR 1,800 crore CapEx apparently looks very high. As Mr. Akhoury just pointed out, we have three blocks.one We have prospected one block, which gives 600 million tones. Ultimately, we intend to reach 4 million, 4.5 million tones of capacity there. Once you start looking at setting up that kind of a capacity, we are starting with 0.95 million tones of clinker and one million tones of cement.
We have to create the necessary infrastructure, acquire the land, draw the power lines according to our ultimate plan. Lot of brownfield expansion expenditure gets front-ended, and that is why this figure is looking so high.
Perfect, sir. This helps. Sir, my second question is on the cost levers. Any variables that you would like to highlight, say over next two, three years, wherein we can actually improvise on the cost? Probably if you can touch upon any targets on WHRS. Second is RE, third is clinker factor, and fourth is railway. I think when I met you last time, you had indicated, the railway volumes, we look to double it over next few years. Some numbers over here also would help, sir. Thank you so much.
Logistics and some capacity are there.
No, I mean, no company runs out of arguments by which it can better its performance. Shree, of course, has many strong arguments where we can further work on our efficiencies and improve the performance. Last time we spoke about railway projects. We have railway, we have AFR, we have our renewable power.
All these are part of how do you improve your cost position. That is what we are working on. On railway, we are working on at least three, four different, actually different sites on the railway. At this moment, it will be not fair for us to disclose a number, be rest assured that all those arguments we are using very strongly to further improve our cost position.
Sir, sorry. Sir, thanks for that. Any numbers that you would like to qualify for WHRS and RE, given we are already doing so well, do we have further room to improvise?
WHRS, all our kilns for today and for the future will be linked with WHRS. Even currently, all the kilns that we are commissioning are having WHRS facilities. For RE, very deliberately, I'm not giving you a number today. Maybe by next call we should be in a better position to give you. Solar energy, we are strong. I mean, you have seen that we already are 61%. Wherever there is an opportunity, we will continue to invest in renewable energy, solar included, to make sure that we take advantage of this of this to further better our performance.
To supplement Mr. Akhoury's statement, we are also quite aggressively exploring the possibility of a viable battery energy storage system, BESS. We have started experimenting on a few things. If that succeeds, then there will be a huge potential of setting up further RE capacity, especially in solar.
Perfect. Sir, clinker factor, what it is right now, and do we have any aspiration on this number, say two years out?
Yeah, I'm giving the line to Mr. K.K. Jain. He will give you the numbers.
For the current quarter, the clinker factor is 64.8% against 63.9% December 2025 and 64% in March 2025.
Sir, any target for this, two years out?
Well, that is dependent on what kind of market we are addressing to. There are some markets we are still, they are still on different kind of blends. Let Mr. Neeraj Akhoury explain you further.
For each product, we will be fully optimizing our clinker factor. The future will depend on the product mix, yeah. The product mix will depend on the kind of segment that we will continue to cater to. If it is OPC, then of course there is a problem, results in a lower clinker factor. If it's PPC, it's a better clinker factor. For now, I think our clinker factor is in line with best in class in the industry, to my mind, yeah. Except people who use slag.
I'll stick my neck out and say that probably we have the best clinker factor.
Perfect, sir. This was very helpful. Thank you so much. All the very best, sir. Thank you.
Thank you. Ladies and gentlemen, in order to ensure that the management will be able to address all the question from the participant, we request you to kindly limit your question to two question per participant. If you have a follow-up question, please rejoin the queue. Our next question comes from the line of Raashi from Citigroup. Please go ahead.
Thank you. Just on the cost, sir, what has been the cost movement in this quarter, cost of production versus the last quarter?
Raashi, let me address this upfront. As I said, our per kcal landed cost last quarter was at 1.60. We expect to creep this up to 1.76 or 1.80. We will, Jajoo will share the exact calculation with you. Please understand that we are trying to keep on increasing our thermal efficiency. We used 73 kcal in this quarter vis-a-vis 741 in previous quarter. We are continuously trying to increase this. If we decrease this, then the quantum throughput also falls, isn't it?
Yeah, got it. Sir, for this, besides the power and fuel cost, you would have also witnessed an increase in packaging costs. On a cumulative basis, what kind of a cost increase are we talking about?
Well, you should, roughly take about INR 150 a ton. That is about seven and a half. Yes, Mr. Jain?
There's some increase in the packing cost in the quarter. The impact is in March. If we see the quarter figure, then it is increased by 20 INR per ton. Now.
Which quarter?
Now going forward, it would be around, say, INR 100 per ton there will be increase.
On a total cost basis, just going back to the fourth quarter, you had an increase in the power cost, you had an increase in freight as well as in packaging. On a blended cement, cost of production would have gone up by how much during the fourth quarter sequentially?
Increase in cost.
should be around, say, INR 150-INR 200 per ton, including packing and the raw material cost as well as this power, fuel and all.
This is in the fourth quarter?
No, no, in the coming quarter. In the fourth quarter, almost there's, say the impact of, is around, say, INR 20 or INR 30 in the fourth quarter.
Compared.
Compared to, December.
December.
Okay. Total cost increase, INR 20-30 versus the third quarter.
Third quarter.
Okay. Just one, what was the percentage of blended cement and trade cement during the quarter?
Yeah.
It's, 64%. 64% was the trade sale.
Okay. Thank you.
You wanted the trade sale, right? Not blended cement.
Blended is around 60. Blended is 62%.
Blended is 62% and trade is 64%.
Correct.
Thank you.
Raashi, are you done with your question?
Yes, I'm done. Thank you.
Thank you. Our next question comes from the line of Parvez Kazmi from Nomura Group. Please go ahead.
Good evening, sir, and thanks for taking my question. I'm sorry, if you've answered this question earlier, but just wanted to get what was our kcal cost in Q4?
Come back again, please.
Sir, what was our kcal cost in Q4, FY 2023?
It's 1.6.
INR 1.60 per kilocalorie landed at our plant.
Sure. Just one more question. What would have been our fuel mix in Q4?
For Q4 it was, petcoke was 54%, coal was 32%, and alternative fuel was 14%.
Oh, sure thing. Thanks and all the best.
Thank you. Our next question come from the line of Prateek Kumar from Jefferies. Please go ahead.
One question.
Good evening, sir. My question is on your pricing gap closing with last year. You talked about closing 20 rupees gap. Is this similar across regions? Is this the stabilized level? Of course, you said, there's always scope to improve, but how is this different across regions?
Let us understand, Prateek. INR 15-20 is the delta decrease across region, and we intend to compress it further. The demand plays a major role in pushing the price rises. Let us see how the demand pans out.
Sure. This pricing gap reduction, has it happened over past three quarters, right?
Volume.
Since then your volumes.
Yeah. Over the years there's been a continuous exercise. Till third quarter we had restricted our volumes to have the price gain. Fourth quarter, we have done all right. The pricing is fine, the volumes are good, and we intend to remain like that.
Sure. Other question is on your RMC business, revenue for Q4 and full year and EBITDA for Q4 and full year.
RMC revenue is INR 90 crore and the volume is 1.99 lakh tone.
RMC is at a very nascent stage. It just started, yeah. We are a very new 26 plant company now going to 36. I think we will take a few more quarters and maybe some years before we are able to report RMC independently, yeah, as a business line. Go ahead.
The revenue was INR 90 crores for Q4 and for full year, what was the number?
it is INR 246 crore.
Sure. Thank you. These were my questions.
Thank you. Our next question comes from the line of Pulkit Patni from Goldman Sachs. Please go ahead.
Sir, thank you for taking my question. I just have one question. You spoke about packaging cost increase of INR 20 already done and another maybe INR 80-INR 100 in Q1, and there's another INR 150- 200 of fuel cost increase. Sir, would that be it? I'm just trying to understand what is the kind of inventory of fuel that we have right now at the plants, and does it fully reflect in Q1 or Q2 we'll see further inflation in that?
No, wait a minute. As far as Q2 is concerned, we cannot comment. Can you tell me when the war will be over?
No, sir.
Hear me out, please. Hear me out. At the moment we are saying that our per kilo calorie cost in Q4 was 160, which is likely to go up by 10%-12% in Q1. Q2, we are not in a position to comment. There are no cargoes available, floating cargoes available, the Strait of Hormuz is playing its own spoilsport. It is very difficult. It's extremely dynamic situation. Is PVC. Now PVC granules are vanishing or having a dynamic price rise.
The indication as on date you can take INR 100 per ton of packing cost rise and balance, as Mr. Jain had explained to you, within the quarter at varied time, depending on the weighted average cost of consumption which we use or which most companies use, the incremental negative impact of such cost rise will be incrementally reflected in our results. Also remember that we, the industry as a whole is suffering on these two accounts, and there is a conscious effort by all players to try and have a price rise which should mitigate this cost increase.
Sir, I fully appreciate that. The reason I'm asking this question is some of your peers have highlighted that they maintain between 60-70 days, 75 days worth of fuel inventory.
Let me One second, I'm sorry.
Can I quickly-
Mr. Patni.
Okay, go ahead.
Please understand that they talk of 60 to 75, we have never gone below 90.
Sir, in which case the fuel cost should hit us in the second quarter, right? I'm a little confused. Sorry, help me understand this.
I said that people are saying they carry 60 to 75 days of inventory. I say our coal inventory is now, doesn't go below 90 days.
Sir, if the war started end of February, early March, then it is not before the last month of this quarter that increased cost should hit you, right? Right now we should be operating with full.
No, no, no.
full cost inventory.
No, no, my dear friend, you are slightly mistaken. The charge is on weighted average cost, not on procurement cost or historical cost. The weighted average cost with every shipment keeps on increasing if the fuel price is rising. Yes, the major impact will come in the third month. Every month you will have some incremental effect.
Precisely, sir. In which case, whatever is getting ordered today, the second quarter impact of cost will be much higher. That's what I'm trying to assess.
You are assuming that the same pricing will sustain, that the war will keep on going, that all shipment chaos will be there. I'm not in a position to hazard that guess at the moment.
Fair point, sir. It's a point well taken. Thank you.
I would like to clarify one thing. There will be, say, cost impact of INR 150-200 in the second quarter as compared to the December, March 2026. This is in totality, including the packing bag cost.
June quarter.
In June quarter. Not separately for the coal and the packing bag.
Packing bag. Also this is cumulative cost.
It's a put to together all.
Okay. Very clear, sir. Thank you.
Thank you. Our next question comes from the line of Raghav Maheshwari from Equirus Securities. Please go ahead.
Yeah, hi. Good afternoon. Good evening, sir. Firstly, congratulations on good set of results.
Sir, my question is on the firstly the current situation in the north market for the fly ash related, because due to the continued hike effects is going into the next for the FY 2027 and 2028 into the northern market. How will you see the fly ash availability in the north and is it the sufficient fly ash available because we are expecting there is no major new power plant coming. How is the fly ash situation especially into the.
[Foreign language]
Yes, sir.
[Foreign language]fly ash is the only cementitious material which we can use, [Foreign language]. There are various other cementitious material which can go into PPC and we are keeping on scouting for all such alternatives. [Foreign language] thermal capacity [Foreign language]. [Foreign language].
Got it, sir. What kind of generally we use for other materials other than fly ash for the PPC?
[Foreign language]
Okay, sir. Thank you.
Thank you. Our next question comes from the line of Giriraj Ray from Nirmal Bang. Please go ahead. Giriraj Ray, you may please proceed ahead with the question. Thank you. As there is no response from Giriraj Ray, we will move forward to the next participant. Our next question comes from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Yeah. Just a follow-up question, sir, on the operating numbers. While most of them are already answered. What was the lead distance that you mentioned in Q4?
I think it was 459 km.
455 km. Okay. That's interesting. Yeah.
Wait, wait.
What is the exact number? 457 s orry.
Okay. This you are looking to go back to 440 in subsequent quarters.
Yes.
And sir price hike that-
440 even lower.
Understood. Understood.
[Foreign language] lower.
Yeah, yeah. Sir, lastly on the cement price hike across market, in your operating markets, this INR 150- 200 cost inflation that you are seeing for Q1, are they fully covered in the price increases which you have taken in the month of April?
[Foreign language] price increase [Foreign language] were anticipatory, anticipated cost increase up to June [Foreign language] ?
Yes, yes.
[Foreign language] cost to dynamic [Foreign language] pricing situation we dynamic [Foreign language] demand we dynamic d emand affects pricing. [Foreign language] Yes, we are generally covered. [Foreign language] adverse movement [Foreign language] quarter [Foreign language] Proclaim [Foreign language]
Understood.
We don't proclaim.
Correct, sir. Sir, given the steel prices have also shot up significantly and there are across the board inflationary impact on construction materials and there have been disruption even on labor availability. Have you seen demand, you know, disappointing in the month of April and May so far?
April [Foreign language] slowdown [Foreign language] May [Foreign language]
Agreed. Great, sir. That's all from my end. Thank you.
Navin, are we through or you have some questions?
Thank you. Our next question come from the line of Navin Sahadeo from ICICI Securities. Please go ahead.
Yeah, just last few people are there for the questions. Sir, just two questions from my side. In the initial comments or maybe to the answer of one of the questions, you said, I mean, Akhoury ji said that the incentives for Meghalaya, though we are like, you know, working with the state, but nothing is promised as yet. Is this a new policy or any change in policy for the state or it's Just help me understand this because other companies which are operating-
[Foreign language]
Understood. My second question was about the north region. I think some time back, Bangur ji in a TV interview had said that they might lose some market shares in the north region because of the several, I think, upcoming capacities. But this quarter, our volume growth has been definitely like, you know, much better than the previous quarters. Also the strategy is very consciously towards focusing on volumes.
[Foreign language] I said that we sacrificed volumes to reach a price and once we reached a price[Foreign language]
Thank you.
Navin, are we through? It is already one hour here. Yeah. We are through, sir. We can conclude that one. Can you please go ahead and conclude, please.
Thank you. That was the last question for today. I now hand the conference over to the management for the closing remarks. Thank you, and over to you, team.
Thank you, everybody. Thanks for this for the call, and thank you for participating. Be rest assured that despite all the numbers that we have shared, and thank you for wishing us well on this 11% volume growth. Many things will continue to unfold in Shree Cement. We will continue to sharpen our approach and focus on cost. We'll also continue to work on our premium products. As you have seen, we have now crossed 22%, up by about 40% from 15% to 22%.
144%. There is a increase in the sale in last two years from 9% to 22% in the premium products.
Oh, yes. From 9% to 22%. We are doing everything possible on using all the levers, be it on the cost or be it on the revenue side, to better our performance in the coming quarters. Inshallah, whatever is the macroeconomic conditions, we will be impacted. Within those conditions, Shree will do its best to continue to deliver some superior results. Thank you, everybody, and have a very good evening. Bye-bye.
Thank you so much, sir. Ladies and gentlemen, on behalf of ICICI Securities Limited, that conclude this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.